Why wouldn’t Skype want 30 million paying customers?

byaleconOctober 25, 2010

Skype has cut Nimbuzz off. What that means is that users of Nimbuzz’ popular mobile clients will no longer be able to make calls using the SkypeOut network. According to Skype themselves, it was for unspecified violations of the Skype API terms and license. Nimbuzz US General Manager Tobias Kemper provided further detail in an interview with the Inquirer:

Kemper explained that Skype wanted greater control of the quality of service and user experience, something that Nimbuzz was unwilling to do. Kemper claimed that Nimbuzz already used superior audio codecs and that it was not willing to give further control over its network to Skype.

Andy Abramson speculates that the reason for Skype’s decision has to do with a desire to not be positioned by regulators as an interconnected carrier. There may be some truth to that, but it certainly runs counter to many of Skype’s other efforts to work with entities like, for example, Verizon and 3.

More likely, in my opinion, is the reason Skype has apparently given. Section 3.1 of the Skype API terms gives Skype broad latitude to control third party’s experience of Skype. If for some reason Skype felt that the Nimbuzz experience didn’t reflect well on Skype, the terms in this section of the contract give Skype the right to cut Nimbuzz off.

Otherwise, why not continue to take revenue from Nimbuzz’ thirty million subscribers?

The reason is simple. The Verizon Wireless', 3's and KDDI's of the world are the carrier. Skype is simply a transport mechanism who GETS paid for that transport of calls to or from Skype users who are not reachable to those operators via Skype. It's a parallel universe of sorts. To protect those relationships they have to attempt to enforce things.